Tackling London’s Housing Crisis

Panellists at a lively Question Time – style event at UCL last night set out various technical solutions to London’s housing crisis, but concluded that ultimately strong and forward-thinking political leadership was most important to lead to genuine change. Chaired by Peter Wynne-Rees, Professor of Places and City Planning at the Bartlett, UCL, the panel’s discussion was wide-ranging and at times impassioned, taking in whether to build on the green belt, major reform of the UK’s financial system and the difficulties faced by both the ‘squeezed middle’ and the ‘squashed bottom’ trying to live and work in London at a time of stagnating wages and rapidly rising house prices. All panellists were speaking in a personal capacity.

Duncan Bowie, Senior Lecturer at the University of Westminster, brought to the panel his extensive experience of spatial planning and housing strategy, having worked for the Mayor of London, the London Docklands Development Corporation and the London boroughs of Newham and Lambeth, amongst other roles. He, along with other panellists, expressed the view that London’s housing crisis is partly due to an oversupply of a particular type of property – luxury flats – built primarily as a vehicle for investment, and also due to inefficient use of current supply – a problem of under-occupation.

All panellists joined Duncan in the view that more housing is needed for rent in London, especially for those on low incomes. In the UK, out of step with the rest of Europe, long-term private rental is uncommon. Successive governments have prioritised home ownership, and there was a common consensus in the room that long-term rental should be de-stigmatised and treated as a legitimate choice for those not wishing to take out a large mortgage, required to pay this off often into retirement.

Panellist June Barnes, Board Member, Urban and Civic Property Developers, was clear that we need fundamentally to readdress our focus as a society on homes as commodities, with the expectation that they are assets that will keep appreciating in value. Instead we need to think of homes as for need. The panel commented that citizens have a right to accommodation and that therefore Government has a role in helping to provide this, across the breadth of income levels. Instead, there was a view in the audience that successive Governments have prioritised the development of an economy built on mortgage debt, that relies on constant consumption and credit and which is therefore reliant on both home ownership – and the borrowing to finance this – and ever-increasing house prices.

To address this ‘self-fulfilling cycle of house price inflation which is prone to crashes’, panellist Anne Martin, New Economics Foundation, was clear that major reform of the UK’s economic model is required. A diverse banking sector is necessary, with large banks broken up and the formation of a mix of institutions, including non-profit and stakeholder-led, similar to the ‘Sparkassen’ savings bank network in Germany. Rather than investing in mortgage debt, banks in the UK should invest in the ‘productive economy’: production, jobs and infrastructure. The view that the ‘housing crisis’ is somehow discrete and can be solved without also wholescale reform of the financial institutions which are intimately bound up with housing in the UK, is erroneous.

The panellists acknowledged that whilst the solutions they discussed may seem simple, this is not the same as the solutions being easy or politically acceptable. One such example was building on the green belt; a contentious issue for many people. New housing built in London is very dense. Duncan Bowie wrote the density policy within the London Plan, setting this as a maximum density of 435 dwellings per hectare. Now developments are being brought forward and approved at densities of 2,000 dwellings per hectare, four times this policy ceiling. This raised issues for the panel and audience regarding both the long-term maintenance of these properties (for example, how to re-clad 30 storey tower blocks in years to come when the cladding begins to fail) and the long-term desirability of living there for residents.

When space is a constraint in central London, more land is needed to build lower density dwellings, for families for example, and the green belt offers an opportunity for this. Rather than resettle people in new towns outside of London, raising issues around how they would travel to work which are particularly pertinent for those on low incomes, the green belt offers an opportunity to build on the edges of existing urban settlements well connected to the capital.June Barnes expressed the view that just releasing two to three percent of the green belt around London would create adequate land for low density developments. Much of the green belt is degraded land, she suggested, with greater biodiversity found in urban gardens and parks. It would be important, panellists agreed, to develop parts of the green belt with strict tests for sustainability and biodiversity, creating ‘green lungs’, parks, as part of developments.

Overall, the panellists suggested that a lack of political will and leadership was the greatest barrier to addressing London’s housing crisis. There was a call from the panel for individuals to exercise their own power to make a change. Panellist Austin Reid, Chief Operating Officer of Circle Housing, a large Housing Association, called on ‘Generation Rent’ to make the case to policy-makers about the challenges that they face, with insecurity of tenure, poor quality lettings and expensive rents, to Government. The Mayor of London was also seen as an individual needing to play a far greater role in addressing the crisis. June Barnes suggested that the new Mayor, following the 5 May elections, should declare London a ‘Housing Crisis Zone’, defining the measures that it would take to move the city out of this designation and then tracking progress against these targets, open to public scrutiny. Echoing the recommendations of the recent report of the London Housing Commission, chaired by Lord Bob Kerslake, several panellists called for the Mayor to argue for a much stronger devolution deal with central Government, gaining greater powers to work with the Boroughs to drive through a major increase in house building.